WASHINGTON — A new consumer survey released by the American Bankers Association has found “consumers are happy with their debit cards and think the government should leave the debit card payment system alone.”
The same survey also found strong support for overdraft protection programs.
The survey, conducted for the ABA by Morning Consult, is being released at the same time the Federal Reserve has proposed to further lower the price cap on the debit interchange merchants pay to process debit card transactions, which both the bank group and credit unions oppose.
An ‘Overwhelming’ Finding
According to the ABA, the survey found U.S. adults overwhelmingly said they are satisfied with the ease of use when making a purchase with their debit card (86%), the security of their financial information when they use their debit card (81%), and the speed of the transaction when using their debit card (86%).
Only one in five respondents (21%) support the government making changes to the debit card system,” the survey found.
“Following the Federal Reserve's price cap on debit interchange rates merchants pay to process debit card transactions in 2011, retailers promised to lower prices for consumers, but failed to deliver,” the ABA said in releasing the findings. “According to this survey, only 4% of respondents say they experienced lower prices as a result of the price cap, with nearly 10 times as many consumers saying prices actually increased. Only 12% of respondents think retailers will lower prices if the Federal Reserve further caps interchange rates, while 34% think they will raise prices and 36% think they will keep them the same.”
Positive Views of OD Protection
Meanwhile, the ABA reported its survey also found 67% of consumers find their bank’s overdraft protection valuable – as compared with only 16% who do not find it valuable – and 8 in 10 consumers (79%) who have paid an overdraft fee in the past year were glad their bank covered their overdraft payment, rather than returning or declining payment.
Other Findings
- 64% of consumers think it’s reasonable for banks to charge a fee for an overdraft, as opposed to only 23% who think it’s unreasonable
- 72% view overdraft fees as reasonable when considering that large payments like mortgages or rent payments are covered and paid on time or that customers are protected from late or other penalty fees if payments overdraft a customer’s account
- 88% said it is easy for them to check their account balance so that they can avoid overdrawing their account
- 65% of respondents are aware that customers can opt out of receiving overdraft protection at any time after they’ve accepted the service, as compared with only 7% who incorrectly believe that customers are required to stay in the program once they accept the service
- Of those respondents who are currently enrolled in overdraft protection, four in five consumers (78%) have never seriously considered stopping or getting out of the service
- 69% said they prefer that their bank offer overdraft protection as an option to customers whether there is a fee or not, as opposed to only 13% who prefer that their bank not offer overdraft protection at all
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